The Russian Ruble drifted higher against the U.S. dollar in the European session on Friday, after Russia's central bank raised its key rate amid rising inflationary expectations.

The Board of Directors, led by Governor Elvira Nabiullina decided to lift the benchmark rate by 50 basis points to 5.00 percent. Economists had forecast a quarter point hike.

The bank observed that recovery in demand is becoming more and more resilient and in a number of sectors is outstripping the possibility of increasing output. In these conditions, the balance of risks is shifted towards pro-inflationary ones, the bank said.

The Russian Ruble approached 74.80 against the greenback, its highest level in a month. The pair had ended yesterday's deals at 75.42. The Ruble is likely test resistance around the 72.00 area.

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